Eamonn Sheridan at Forex Live has some interesting comments on China’s December Trade Balance.
The export figures are a focus and they are poor indeed. But save some space in the barf bag for the import results, they are terrible – huge miss on these.
Demand in China has been showing evidence of slowing. This is a nail in the coffin.
December 2018 Data – Yuan Terms
- China trade balance comes in at CNY 395bn, expected CNY 345bn, prior was CNY 306bn
- Exports 0.2% y/y, expected 6.6%, prior was 10.2%… BIG MISS
- Imports -3.1% y/y, expected 12.0%, prior was 7.8% … even bigger miss
December 2018 Data – US Dollar Terms
- China trade balance USD 57.06bn, expected $51.6bn, prior was $44.7bn
- Exports -4.4% y/y, expected 2.0%, prior 5.4%
- Imports -7.6% y/y, expected 4.5%, prior was 3.0%
Tariff Man
Chinese Investment in the US Slumps to 7-Yr Low
The Financial Times reports Chinese Investment in the US Slumps to 7-Yr Low
Including $13bn in US asset divestitures by Chinese investors, China’s net US investment actually shrank by $8bn in 2018.
Negative Revisions
Worst China Data in 15 Years
Expect “Greatest Deal Ever”
Both the US and China desperately need a deal.
So, as I stated 5 days ago, Expect a Deal With China, Just Don’t Expect Much From It.
And should there be a deal, expect announcements of the “greatest deal ever” no matter how trivial the deal really is.
Europe Likely in Recession Now: Germany, France, Italy Production Collapsed
In case you missed it, Europe Likely in Recession Now: Germany, France, Italy Production Collapsed
German, French, and Italian industrial production collapsed in November. Italy GDP is negative for 3rd Quarter.
A global recession is on deck.
Mike “Mish” Shedlock
Good news for the coming great RESET!
We may have a recession. We may be in one right now. But it won’t be reported until 6 months after it ends.
Same type of thing for EU/UK. Warehouses full of imports in UK in preparation for March 29th. Expect further weakness as that is run off Q2,3.
Mish, here is a song that seems appropriate for this time of [trade] war:
What will be more interesting is what happens trade data in Q1. In Q4 people were clearly ordering ahead, and filling warehouses ahead of the first of the year. Q1 should see a big drop, and then in Q2 we’ll see where we are.
Shanghai’s sales tax is down something like 69% YoY, which is more understandable when you realize their sales tax is only on things they consider to be a luxury.